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The accreditation of China’s social enterprises

This recent article by the China Philanthropy Research Institute examines the controversy over the accreditation of social enterprises in China.

There are still many disputes on whether to set any standard criteria for social enterprises and how exactly to conduct accreditation in China. All the same, a wave of rapid developments in this field has occurred since last year. The first private accreditation guide for social enterprises, the China Charity Fair Social Enterprise Accreditation Guide (中国慈展会社会企业认证办法), was initiated and published last September by five social organizations, including the China Philanthropy Research Institute. Seven organizations were then accredited as social enterprises in line with the guide. However, the small number and scale of social enterprises in China bear witness to the sector’s fragmented development. During the recent forum Challenges and Approaches of Social Enterprises, Professor Yuan Ruijun from Peking University estimated that less than 500 social enterprises operate in China.

The author of the article, therefore, reckons that the criteria for accrediting social enterprises should become more diversified. Since the accreditation standards follow the doctrine of “pragmatism”, they tend to serve a specific purpose. Each of them indicates its own expectation for social enterprises’ current and future impact and determines the necessary support they need. It might thus be preferable for a variety of standards to co-exist simultaneously and fuel social enterprises’ development. Not only the government but also credited social organizations could issue accreditations. A prominent example is the practice in the UK where five standards with different emphases currently coexist. The author believes that what defines a social enterprise is not its accreditation but its nature, which is defined by a “state of mind” of solving social problems through business means.